OBSERVING Derek Hatton in the dock, accused of conspiracy to defraud Liverpool City Council, three questions spring to mind. Is he guilty? Why is he being tried in Mold, a small Welsh town 30 miles from the scene of alleged crimes in England? And will the dock be large enough to accommodate his wardrobe over the next three months or so?

The opening days of his trial are inconclusive on these matters. As to the first, we have little more than the prosecution's assertions, Mr Hatton's denials, and some tiresome performances by drab witnesses from Liverpool city hall. On the second, there is a theory: Liverpool jurors, living for years with the political upheaval surrounding their city council, could not reasonably be expected to be objective about its former deputy leader.

Mold is light-years from Scouse City. A market town overlooked by the gentle Clwydian range, it has not had serious social unrest since the Mold Riot of 1869 (following a local coal company's arbitrary reduction of miners' pay).

His court-going garments are equally varied, if more muted: an elegant coat reaching to mid-calf, a light-grey jacket, draping freely from square shoulders, a navy- blue suit in the Italian style, set off by a floral tie. It seems fitting that this ex-politician who became a public relations man should rub shoulders in the dock with his tailor, John Monk.

Mr Monk, who operates car parks as well, is also charged with conspiracy to defraud Liverpool council. He, Mr Hatton, and John Nelson, a former Labour councillor, deny conspiring to defraud the council on various dates between 1986 and 1987 by dishonestly influencing and causing the council to license the use of city land at a value less than could be obtained on the open market. Two other defendants - Hannah Folan, a former Labour councillor and Roy Stewart, a property developer - deny charges relating to city-council business on various dates between 1986 and 1990.

Mold Crown Court was opened in 1969, two years before Derek Hatton (then 21) joined the Labour Party (he was removed in 1986). The dock - satin-finish rails on red imitation leather - resembles a cocktail bar; its occupants chuckle at remarks from the judge ('Prioritise? There's no such word]'), and sip from plastic water-cups. In the morning, before the judge sits, his back to a tall slab of apricot-coloured marble, there is banter between the accused and the Liverpool press (Mr Monk: 'Nice piece in the Daily Post, but who wrote that stuff in the Echo?').

Mr Stewart looks relaxed. Mr Hatton stares intently at the court clerk - a pretty young woman - until she looks up. Then, sharply through compressed lips, he sticks his tongue out at her by way of greeting, eliciting a confused smile.

Yet as each day progresses, spirits sink in the public gallery. The evidence from lacklustre Liverpudlians - two city surveyors and a valuation assistant so far - comes in monosyllables or qualified phrases ('It depends on the circumstances'; 'I wouldn't wish to generalise').

Large grey boxes of documents seem to grow taller as barristers slump behind them. Mr Hatton gnaws at a nail, leans on an elbow, stretches his jaw, snaps it shut. The jurors - five men and seven women, all but one casually dressed - squirm for comfort during an exchange over city-hall hierarchy. Their mock-leather seats emit sounds startlingly like those of breaking wind.

Optimists say the case should be over by Easter, having cost not less than pounds 2m.